U.S. stock futures pointed to sluggish start Tuesday after the biggest one-day advance since November, as markets digested a plan by the U.S. Treasury to encourage private investors to snap up toxic assets from troubled banks.
S&P 500 futures fell 8 points to 809.30 and Nasdaq 100 futures fell 10 points to 1,242.00. Dow industrial futures slipped 58 points.
On Monday, U.S. stocks blasted higher by around 7% as the government announced details of its plan. The government may finance the purchase of as much as $1 trillion of bank assets. The Dow Jones Industrial Average leaped 497 points, the S&P 500 rose 54 points and the Nasdaq Composite jumped 98 points.
Stocks in Asia rallied on Tuesday, with the Hang Seng up 3.4% in Hong Kong and the Nikkei 225 up 3.3% in Tokyo; in Europe, gains were modest, with the pan-Europe Stoxx 600 up 0.4% and the FTSE 100 losing 0.8% in London.
"At least a mechanism is now in place for tackling the issue of toxic assets and loans, and any shortcomings in the current policy can no doubt be rectified over time," said Rob Carnell, a London-based economist for ING.
Tuesday's docket features Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke testifying before the House Financial Services Committee on the bonuses paid to American International Group The uproar over AIG has reportedly led Goldman Sachs to move more quickly to repay the government funds it's received.
The Wall Street Journal reported that the bank may sell its stake in the Industrial and Commercial Bank of China to help it repay $10 billion of money it received under the Troubled Asset Relief Program, with The New York Times reporting that the repayment could come within a month.
Goldman stock also is nearing the $115 level under which the equity warrants of Berkshire Hathaway would be in the money.
General Electric -- another firm which has raised money from Berkshire Hathaway -- saw its triple-A rating revoked by Moody's Investors Service, one week after having it withdrawn by Standard & Poor's.
Meanwhile, Credit Suisse said it's had a strong start and has cut the risk from its investment bank business, and Deutsche Bank said it's expecting to make a profit this year and doesn't need to raise capital.
Outside of financials, the world's top steelmaker, ArcelorMittal , said its first quarter earnings before interest, tax, depreciation and amortization would range from 15% above to 15% below its $1 billion target. The company also said it would raise $1 billion by selling a convertible bond.
The January home price index from the Federal Housing Finance Administration is due for release.
Gold futures saw pressure, with the lead contract down nearly $15 an ounce. The dollar rose sharply vs. the Japanese yen while losing ground vs. the British pound.
